is enacted to adopt one of these standards. As a result of this federal system, there is no uniform rule which a manufacturer may follow in order to be sure that his products will be acceptable in all parts of the United States. The existence of many local technical regulations in the United States does create a severe marketing problem for some products, affecting American and foreign goods alike. In this area, Japanese firms may need assistance in gaining access to the U. S. market. Thus, both the Japanese and the U. S. standards-writing systems developed largely in response to local historical circumstances and were not designed to impede foreign trade per se. At this time, however, each country will need to make significant changes in its existing practices in order to implement the Multinational Trade Negotiation (MTN) agreements and to accommodate better the needs and interests of foreign traders. In par ticular, Japan's role in the international trading system has become so great as to make such accommodation necessary. Under "Recommendations" below, the GPC makes certain proposals as to how this might be accomplished. STANDARDS The GPC decided initially to analyze the procedural and substantive aspects of Japan's standards from the perspective of the basic rules set forth in the "Code of Conduct for Preventing Technical Barriers to Trade," better known as the GATT "Standards Code," which was adopted as part of the recent MTN agreements and became effective on January 1, 1980. Simply stated, the Code is intended to ensure that there is no discrimination against foreign goods in standards-writing, inspection methods, certification systems and "marks" of approval. It requires that public notices of intent to prepare standards or certification systems be given, comments be solicited from all interested parties, and those comments be considered in drafting the final standard or instituting the new certification system. Procedures are to be no more complex nor less expeditious for foreign goods than for domestic goods. Information and assistance on how to comply with technical regulations is to be provided by each adhering country. Finally, a central point of inquiry is to be established by each government. The Committee first turned its attention to a comparison of existing Japanese procedures with the requirements of the Code. The first problem area identified was limited foreign participation in the Japanese standards-writing process. In order to update the prewar Japan Engineering Standards, which proved to be inadequate to meet postwar international competition, the government enacted the Industrial Standardization Law of 1949, under which the Japanese Industrial Standards Committee ("JISC") was created. JISC has the responsibility for developing a group of standards entitled Japanese Industrial Standards (JIS). The competent ministries award a "JIS mark" to products meeting the appropriate JIS, and made by factories whose production and quality control facilities meet the ministry's requirements in a departure from other "marks," the JIS mark relates to the product and the process. A second major source of Japanese standards are the technical regulations issued by ministries covering goods within their respective jurisdictions. MITI, for example, issues mandatory "marks" of approval which are given only to products meeting certain requireThese marks include the following: ments. 3. Passed Mark.(Law concerning Maintenance of Safety and Normalization of Transactions of Liquefied Petroleum Gas). 4. Approved Mark (High Pressure Gas Control Law). 5. Safety Mark (Consumer Product Safety Law). 6. "T" Mark (Electrical Appliances and Materials Control Law). In formulating such requirements or standards, MITI and other ministries either rely on recommendations from the standards-writing committees of various industrial associations or call together ad-hoc groups established for drafting a specific regulation. Thus, Japanese standards are usually issued by official or semi-official bodies in contrast to voluntary consensus groups in the United States such as the American Society for Testing and Materials, the National Fire Protection Association, or the American Society of Mechanical Engineers. The Japanese system described above has discouraged the participation of foreigners in the creation of standards which affect their products, despite the absence of any formal rules barring such participation. In some cases, foreigners have not been invited to participate in committees which make recommendations on standards or to present their point of view to the official bodies involved in promulgating standards. In other cases, U.S. firms resident in Japan have sometimes been reluctant to participate because of potential U.S. - 7 anti-trust implications relating to some of the associations' other activities. In still other cases, they simply have not been permitted to participate, even though they are members in good standing of the council or association in question. Standards-writing bodies have been more open to foreign participation in the United States than in Japan. The Society of Automobile Engineers in the United States, for example, has a foreign membership of 1, 574 of whom 202 are Japanese, and the American Society for Testing and Materials includes 115 Japanese members. Membership in the association sponsoring the preparation of a standard is not a prerequisite to participation in the standards-writing body. The Japan Society of Mechanical Engineering (JSME), on the other hand, has only 140 foreign members out of total membership of 40, 700. The Japan Society of Automobile Engineers (JSAE) has only 50 out of 15,000. It should be noted, however, that there is no regulation prohibiting foreigners from participating in these organizations. Apart from the immediate language barrier, foreign members can express their views in these organizations or at least use them as a vehicle for collecting information, including information on standards and testing. Therefore, a large part of the problem would be solved if U.S. companies were to be more aggressive in seeking membership in these associations and using that membership to good advantage. Procedural problems have been compounded by the absence of a comprehensive source of advance information about impending standards changes, readily usable by foreigners. First, standards changes have been announced to the public only after the time for submitting comments or recommendations had passed. Second, public notices have been published in the Kampo or "Official Gazette." Items in Kamoo (which is not indexed) are arranged in accordance with the hierarchy of the organizations acting on the matter concemed. Matters requiring Diet action are listed in the first group, cabinet orders in the second (both in order of ministry seniority), specific ministerial orders in the third, and so on. This system, which has been used for more than 100 years, is familiar to the Japanese, but generally has not been understood by foreigners requiring information printed in Kamoo. It is not, however, the position of the GPC that Kampo should be altered for the benefit of foreigners. A more practical solution is suggested by the GATT Standards Code, as detailed below. There is a monthly bulletin, "Standardization Journal," issued by the Japanese Standards Association (Nihon Kikaku Kyokai, phone Tokyo (03) 583-8001) which gives prior information on contemplated changes in JIS. The journal also carries information on various foreign products standards. Unfortunately this bulletin is not very widely known among foreigners, probably because it is available only in Japanese. II. B. Status The Japanese government has recently made several changes in standards-writing procedures which make it easier for foreign companies to participate in or comment on the process. With respect to electrical appliances, for example, MITI has made certain specific changes (including inclusion of a 'U.S. representative on the Japan Electrical Association (JEA) Advisory Committee) which are reported in greater detail in the Electrical Appliances Task Force report. In addition, a cabinet decision of May 22, 1979 contains the following two key procedural principles: 2. When adopting or modifying standards, public notification of such intention will be made, to the extent possible, sufficiently in advance. 3. After such notifications are made, opportunity for interested parties, whether domestic or foreign, to submit their views will be provided as much as possible, and views thus submitted will be given due consideration. For this purpose, improvement in procedures shall be facilitated where necessary." Following this decision, MITI has started to announce standards changes in advance in JETRO's Daily Bulletin (Tsusho Koho). The American Embassy has translated these announcements, and the GPC had furnished copies to industrial magazines in the United States and to ACCJ members. The U.S. Department of Commerce has disseminated information about them to people known to be interested. As a result of the publication of these announcements, numerous firms have written to the GPC for additional details on intended changes. Although the notice period is still much too short, MITI's action represents a welcome improvement over previous procedures. The GPC is concerned, however, that it has been unable to learn of any such public announcements emanating from other ministries. Since it is unlikely that no other ministry is contemplating standards changes, other ministries should also follow a public notice procedure. It would be most beneficial if one single source could be charged with publishing all such notices. Substantive Problems A. Situation U.S. exporters to Japan also have encountered several substantive problems with Japanese standards. The first is that JIS marks are not presently available for products manufactured abroad. Although, in theory, JIS marks are entirely voluntary and not required by law, in practice they have been adopted by several government agencies as mandatory. The Japan Water Works Association (JWWA, for example, is a non-profit association organized under the auspices of the Ministry of Health and Welfare. The Ministry commissioned JWWA to formulate specifications for plumbing fixtures to be connected directly to city water mains. These specifications were adopted as mandatory by municipalities and other local government bodies which operate city water supply systems. The regulations provide for the use only of fixtures complying with JIS standards or "equivalent," resulting in the effective barring of foreign products. Similar adoptions of JIS as mandatory standards apply to certain automobile equipment, electrical goods, high pressure gas storage and pollution test methods. The GPC has learned that the requirements for receiving the JIS mark are so stringent that even small or medium-sized Japanese companies often do not have the capacity to comply. As a matter of fact, only two or three percent actually apply for the JIS mark. To the extent that compliance with JIS is important in gaining private or government sector acceptance, JIS standards should be reasonable and foreign products meeting them should be able to utilize the JIS mark without difficulty. The first of the basic principles stated in the cabinet decision referred to above is that "when adopting or modifying standards, conformity with international standards will be sought as much as possible, while taking into account circumstances unique to Japan. "* Unfortunately, a majority of JIS (just as many other national standards) are not comparable with international standards. Moreover, the majority of the JIS which are comparable to international standards are product description standards. Greater deviations exist in test method standards. As a result, it is difficult to judge the comparability of product JIS, since they rely upon testmethod JIS to describe performance characteristics. B. Status 1. MITI has recognized the need to make the JIS mark available This statement was made by Mr. Masafumi Ono, Director of the |